The opinion of the court was delivered by: Bua, District Judge.
Before this Court is defendants' combined motions to stay this
action pending arbitration, to dismiss certain defendants, and to
change venue. Plaintiff Centaur Insurance Company ("Centaur")
seeks a declaration of the various parties' rights and
liabilities pursuant to a series of insurance contracts.
Jurisdiction is based on 28 U.S.C. § 1332. For the reasons stated
herein, this Court grants Centaur's motion to change venue.
Further, this Court transfers the action to the United States
District Court for the Central District of California. Because of
the transfer, this Court declines to consider defendants' motions
to stay and to dismiss.
Centaur, an Illinois corporation, reinsures risks undertaken by
other insurance companies. Over the last few years, Centaur
entered into a number of reinsurance agreements with various
defendants to indemnify those defendants. Most of the agreements
contained arbitration provisions that selected Los Angeles,
California as the sole cite for arbitration. All five defendants
have their principal places of business located in Los Angeles,
The appropriate starting point for a motion to change venue is
the statute itself. 28 U.S.C. § 1404(a) provides:
For the convenience of parties and witnesses, in the
interest of justice, a district court may transfer
any civil action to any other district or division
where it might have been brought originally.
This provision is designed to eliminate wasted time, energy, and
money. In addition, it protects litigants, witnesses, and the
public against inconvenience and expense. Continental Grain Co.
v. Barge FBL-585, 364 U.S. 19, 80 S.Ct. 1470, 4 L.Ed.2d 1540
(1960). The issue before this Court is whether Centaur's action
should be transferred to the Central District of California.
Centaur's desire to bring this action in the Northern District
of Illinois is entitled to substantial weight under § 1404(a).
Ronco, Inc. v. Plastics, Inc., 539 F. Supp. 391, 401 (N.D.Ill.
1982). The decision to transfer, however, lies within the sound
discretion of the trial judge. Wm. A. Smith Contracting Co. v.
Travelers Indemnity Co., 467 F.2d 662 (10th Cir. 1972). The
moving party has the burden of proving that the suit should be
transferred, and must establish that the balance weighs strongly
in favor of the proposed transferee district. Id. at 664.
A 1404(a) motion to change venue requires a two-step analysis.
First, this Court must determine whether the proposed transferee
district is a district in which Centaur's claim could have been
brought originally. An action may be brought in any district
court that has proper venue, subject matter jurisdiction, and can
issue effective service of process upon defendants.
28 U.S.C. § 1391(a) sets forth the districts where venue is
proper. § 1391(a) states that when a plaintiff's action is
founded solely on diversity of citizenship, proper venue lies in
those judicial districts where all defendants or plaintiffs
reside, or where the claim arose. Applied to the facts in this
case, venue is proper in either the Northern District of Illinois
(where plaintiff resides) or the Central District of California
(where all defendants reside).
In addition, the proposed transferee district is proper only if
the Court has jurisdiction over the subject matter of this case
and the defendants are amenable to service of process issued by
the transferee court. American Telephone & Telegraph Company v.
Milgo Electronic Corporation, 428 F. Supp. 50 (S.D.N.Y. 1977). In
this action, the California court's jurisdiction is founded on
diversity of citizenship. Additionally, the defendants in the
instant case are amenable to process in California since all
defendants have their principal places of business located in Los
Angeles, California. Consequently, this Court finds that
Centaur's claim could have been brought originally in California
since venue is proper in California, the California court has
subject-matter jurisdiction, and the defendants are amenable to
process in California.